Indonesia’s Danantara Investment Management and Mandiri Investment Management, along with Japan’s SMBC Aviation Capital, have launched an $800-million aircraft leasing business—Mandiri Aviation Leasing Fund—as Indonesia’s first aviation leasing fund.
Described as an institutional-grade platform, the fund will provide investors access to high-quality global aviation assets, according to an announcement. The fund will be co-managed by Mandiri Investment Management and SMBC Aviation Capital, while Danantara acts as a strategic anchor investor.
SMBC Aviation Capital, with its operational expertise in aircraft leasing, will provide aviation and leasing services, and is expected to support Danantara’s expansion into adjacent global asset classes in the long run.
“The partnership also serves as a foundation for broader economic cooperation between Indonesia and Japan, creating opportunities for further cross-border investment between SMBC Group and Danantara Indonesia,” the announcement said.
Similar to other private credit sub-asset classes, banks have retreated from aviation lending, while capital requirements continue to increase, creating a large funding gap in the sector.
Alternative capital has quickly stepped in, and this new partnership highlights that private credit in Asia is developing beyond direct lending.
Aircraft lessors, who used to depend on bank loans to build their portfolios, are increasingly accessing the speedier private capital.
Aviation financing offers a mix of predictable income, real-asset security, global demand, and long-term value stability, constituting an attractive destination for capital seeking resilience and steady growth, according to aviation asset management firm Acumen.
The broader asset-backed finance sector in Asia is anticipated to gain momentum as there is a growing need for infrastructure development across the region.
